Goettl adds new market with latest acquisitions
Goettl Air Conditioning and Plumbing expanded into Northern Nevada with two company acquisitions.
Goettl Air Conditioning and Plumbing more than doubled its employee count in three years — swelling its ranks to over 1,000 — and its growth plans continue after the company picked up two firms in Northern Nevada, a new market for the local company.
Goettl CEO Ken Goodrich said it’s all part of its plan to “Goettl-ize the nation.”
“Our goal is to build a brand that precedes me and the current management team and grows, and one day we’ll be the premier brand for HVAC and plumbing across the nation,” Goodrich said.
The Las Vegas-based company purchased Nevada Heating, Cooling, Plumbing, Fireplace Inc. in Reno last month and acquired 4 Seasons Heating and Cooling, also based in Reno. Terms of the deal were not disclosed.
The acquisitions continue a trend of rapid growth for the company, whose revenue last year exceeded $200 million, as it plans to potentially acquire more firms.
Jamie Schwartz, director of industry and business engagement at UNLV’s Office of Economic Development, said its common for businesses to grow through acquisitions. She said it allows quicker access to new employees, customers and regions compared to the “bootstrap” method of opening a new location and building out the business from scratch.
“It’s a pretty quick way to grow and get the business that you’re buying producing cash flow,” Schwartz said. “It’s a really easy way to expand.”
Currently, Goettl operates in 12 locations across four states — Nevada, Arizona, California and Texas.
A long history
Goodrich grew up in the HVAC business, eventually buying his family’s company, Racee Air Conditioning, at the age of 25, after his father died. He later purchased Goettl Air Conditioning in 2013. The company grew from 62 employees to 424 in 2019 and now it has more than 1,000 employees with over 500 service trucks, according to Goodrich.
He said much of the growth is a result of acquiring HVAC companies in different markets.
It’s latest pair of deals marks the company’s first foray into Northern Nevada. Goodrich said the company prioritized entering larger areas because it was easier to find new employees with knowledge of the market.
“In a tertiary market like Northern Nevada, I feel that it’s important to have a local partner with a solid reputation, strong local connections, and it never hurts to be a part of the good old boys network,” he said.
Eric Robnett, owner of Nevada Heating, said in a news release that their similar business models will serve customers in Northern Nevada well.
“This is the perfect next chapter for us at Nevada Heating — starting from a garage-based business founded by my father and nearly 50 years of growth in Northern Nevada to joining an established network of HVAC and plumbing companies under the Goettl umbrella,” Robnett said.
Goodrich said the companies will operate under their respective logos but they will eventually be rebranded as Goettl, as it expands and acquires more HVAC and plumbing companies.
“(A single brand strategy) is very important,” Goodrich said. “There’s a lot of companies in our space that are doing acquisitions, but they don’t tie the brands together. It’s very difficult to make a cohesive team that way.”
The company recently expanded the Goettl brand to San Diego and plans to launch in Houston within the next few months, according to Goodrich.
Its short-term plan is to fortify the company’s presence in its current locations, and in the next three to four years, it wants to expand to other states including Utah, Colorado and New Mexico.
Ready for potential headwinds
Gloomy economic forecasts, propelled by high interest rates and inflation, isn’t deterring Goodrich’s optimism about growing Goettl since he views the company as being adaptable to a recession.
“In Las Vegas, air conditioning is not a luxury it’s a life support system,” he said. “So we have always performed well in slower economic times.”
“We’re still kind of playing the strategy of ‘go where it’s hot’ but also picking up markets that are kind of within an hour reach of each other as a means to expand, as opposed to jumping around the U.S. and trying to park management teams three or four hour flights away,” he said.
Containing acquisitions into one region can reduce growing pains for companies like Goettl since markets in the same region share similar characteristics and challenges, according to Schwartz of UNLV.
“By sticking to a similar region, you can consolidate some of that risk. Because it’s the southwest, some of the geography and temperatures and climate are all very similar,” Schwartz said.
But onboarding employees and worker retention as Goettl expands through acquisitions can present challenges.
“Keeping the operations flowing without interruption, that’s what (growth) relies on, and it’s all about the structure and strength of the organization to handle all of that new business and all of those new employees,” Schwartz said.
Goodrich said those considerations are top of mind for potential acquisitions and that Goettl does its due diligence when looking at companies and uses an integration team in every new market to ensure a smooth transition.
“There’s a lot of competitors in the market that are just blindly buying, whereby they’re just trying to buy revenue. But that’s just never been my style,” he said. “I’m kind of the tortoise, in the tortoise and the hare story. I’m building a brand and perpetuating Goettl’s 84-year-legacy far into the future.”
Contact Sean Hemmersmeier at email@example.com. Follow @seanhemmers34 on Twitter.